Deal of the Week: Katy industrial park

An aerial photo of the West Ten Business Park indicates where Transwestern Development Co. has purchased a
74-acre site on Interstate 10 at Cane Island Parkway in Katy. Construction could total 1.2 million square feet.

An aerial photo of the West Ten Business Park indicates where...

Transwestern Development Co. has purchased 74 acres from Parkside Capital in the West Ten Business Park in Katy for a major industrial development that could total 1.2 million square feet, equal to the size of seven Wal-Mart Supercenters.

The Houston-based real estate firm plans to break ground on the first phase of the project in mid-July before securing any tenants. The property, just north of Interstate 10 between Commerce Parkway and the planned Cane Island Parkway, represents the largest tract in the 470-acre development, which is also home to Igloo Products Corp.

Completion of the first phase, consisting of two buildings totaling more than 415,000 square feet, is anticipated in the second quarter of 2015.

"It's a fantastic location that draws from a number of decision-makers that would live out in the Katy area," said Pete Johnston, senior vice president at Transwestern. "A variety of users would be interested in that location."

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Across the Houston area's 550 million square feet of industrial property, only 4 percent to 5 percent is vacant, Johnston said.

"The demand is really outstripping the existing supply for a state-of-the-art new product that we're building," Johnston said.

The initial plans consist of a 340,503-square-foot cross-dock building with 30-foot ceilings, and a 74,793-square-foot building with a front-loading dock and 28-foot ceilings. Additional speculative buildings or build-to-suit projects totaling 800,000 square feet are planned on the remaining 42 acres.

"With the potential for 1.2 million square feet, this is the largest project we've ever undertaken," Carleton Riser, president of Trans­western, announced. "Not only will West Ten Distribution Center be a hub of state-of-the-art facilities, but the planned I-10/Cane Island Interchange makes the park a highly accessible and strategic location for a multitude of industries."

Cane Island Parkway will be constructed through the business park, linking I-10 to U.S. 90 on the north side, Transwestern said. Construction of a four-way interchange at the Interstate and Cane Island Parkway is expected to begin this summer, with completion planned in 2015.

Added credibility

Transwestern is joining Igloo, which has a 420,000-square-foot distribution building on 40 acres, and Medline Industries, which built a 500,000-square-foot distribution building on 56 acres as its Texas hub in the West Ten Business Park.

A deal is in the works for a manufacturing tenant on one of the remaining parcels in the development, according to Parkside Capital.

"Transwestern brings credibility to the park. They are a high-quality, institutional developer," Joe Moody, president of Houston-based Parkside Capital, said in an email.

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"Spec development acts as a catalyst in a park environment like West Ten," Moody said. "We believe their product mix is well-suited to capitalize on the market today."

Transwestern completed the construction of five industrial buildings totaling 385,000 square feet in another Parkside Capital project, Mason Creek Corporate Center, at the end of last year. That park is near Mason Road and I-10.

Transwestern designed the Mason Creek Corporate Center project with buildings of various sizes to suit different types of tenants. No leases have been signed, but Transwestern is negotiating with several prospects, the company said.